On The Way To An IPO, Nutanix Raises A Massive $140M

It was only a few months ago that Nutanix, a five-year old converged infrastructure provider, raised over $100M in funding and today they’re at it again with the announcement of $140M in Series E funding. The round is based on a whopping $2B+ valuation and speaks to the massive opportunity that exists in converging computation and storage. It also comes in the same week that
VMware (disclosure, VMware covered my travel costs to attend their VMworld conference) announced a new approach which sees it partner with hardware vendors to deliver an appliance that converges hardware with the company's virtualization and vSAN storage software.

Nutanix, naturally enough, see this is a real validation of their converged hardware approach rather than a competitive threat. When one consider how much criticism
Oracle has had in the past few years for pushing it’s Exalogic “cloud in a box” approach, it’s interesting to see such massive bets being placed on this converged approach. It is interesting to note that Nutanix have, in recent times, extended its hypervisor support beyond just VMware’s ESX and now cover KVM and
Microsoft Hyper-V – safety in numbers appears to be at play here.

The funding reportedly comes from two Boston-based public market investors but the company has chosen to leave those firms unnamed.
Total funding to date is at $312M and this amount, alongside the fact that the investors are more usually focused on the public markets indicates that this is the last round before a soon-to-eventuate IPO for Nutanix.

Nutanix, Oracle and (now at least) VMware all push to the benefits that converging infrastructure can bring – less space, more power efficiency and reduced cooling requirements. Nutanix claims potential savings of between 20%-50% on comparable standalone hardware. In a briefing earlier this week, Nutanix executives pushed ttheir intelligent software as the key differentiator – this software ties together the various infrastructure layers and helps drive efficiency, flexibility and speed.

Nutanix has 650 employees and already boasts of some 800 customers across 43 countries. Interestingly last years bookings were 40% generated outside of the US – a positive sign for a company that needs to scale to generate its valuation.

This hyper converged approach flies in the face of cheap commodity hardware and disaggregation of software and hardware. The jury is out as to which of those approaches will prove the most successful.